Tag Archives: fraudulent account scnadal

No sell-outs here…

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Beleaguered retailer Abercrombie & Fitch decided that it is not going to sell itself off after all. That bit of news sent shares of the company plummeting as much as 20% today because apparently Wall Street doesn’t think the company has what it takes to pull itself out of its fiscal mess all by itself. Judging by Abercrombie & Fitch’s last several quarters of declining sales – going back to 2014, in fact – Wall Street might be onto something. A&F’s efforts to ditch its logo and start fresh with a whole new campaign for the brand earlier this year didn’t do much to move sales. Then of course, A&F had to contend with competition from fast-fashion rivals like Zara and H&M, which seemed to make matters precipitously worse, and not just for A&F. But it’s not as if A&F didn’t have a few good suitors that were gearing up to help it turn its fiscal tide. Word on the Street was that American Eagle Outfitters, together with private equity firm Cerberus Capital, was in talks with the retailer to acquire it. Unfortunately, for A&F anyway, the two sides couldn’t seem to agree on the terms of a sale and the deal is officially on ice.

Cough it up…

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Just when you thought Wells Fargo was done paying through its corporate nose for its actions that led to its mammoth fraudulent account scandal, along comes another class action settlement. This time to the tune of $142 million, an amount that a federal judge deemed “fair, reasonable and adequate.” But I guess that depends on whom you ask. In any case, the recipients of this latest settlement include customers who had fake accounts opened in their names and whose credit scores may have become negatively affected as a result of the fake account openings. While the actual payment per customer has yet to be established, rumor has it that the payments will be based on how much a customer’s credit score dropped, among other factors. Unfortunately, it probably wont be until after 2018 that customers can expect to see any sort of compensation. This latest settlement is in addition to the $185 million fine levied by state and federal regulators last year and the $3.26 million that the bank had to pay back to customers for fees wrongly accrued from those fraudulent accounts.Wells Fargo, believe it or not, is still undergoing investigations from several states, and that’s even with ten more class action suits in the wings.

Break for it…

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In case you were hoping for a tax increase on the wealthy, then forgive me for dashing those hopes. According to Treasury Secretary Steven Mnuchin, while discussing the tax overhaul proposal – which the White House is very committed to getting passed by the end of the year, fyi – that increase was never on the table. And if you happen to be in that wealthy tax bracket, well then, lucky you on so many levels. It seems there was this “sort of” rumor that a 40% tax increase would be levied on the wealthy that would allow for some nifty tax breaks for the middle class. But alas, it’s not happening. Well, the tax breaks are expected to happen for the middle class, but without imposing a higher rate on those fortunate enough to find themselves in a higher bracket. Mnuchin also assures us that there are no increases in store for the middle class either. Which seems like the decent thing to do.